Bank of America maintains a bearish outlook on the Israeli shekel, holding a long position in the USD/ILS pair that was opened at 2.99 and is currently trading at 3.0. The bank expects the pair to rise, citing an anticipated decline in the S&P 500 and broader weakness in emerging market currencies, and characterises the shekel as overvalued. It notes that the S&P 500 remains the primary driver of USD/ILS movements because local investors hedge their exposure to U.S. equities by shorting the pair in forward contracts, resulting in a low‑correlation beta between the shekel and the index. Bank of America also signals that the Bank of Israel is likely to intervene if the exchange rate reaches 2.80. The trading idea was first presented in a report titled "EM Alpha: Hawkish Fed means higher USDILS & USDHUF" dated June 24. This article was generated with AI assistance and reviewed by an editor, with standard Reuters terms and conditions applying.